GBP/USD retraces from 2-week high, inching closer to 1.3100 handle

A fresh bout of US Dollar buying interest seems to have emerged during the last hour of trading, with the GBP/USD pair extending its retracement from a fresh 2-week high level of 1.3185 touched during early Asian session. 

Currently trading around 1.3120-25 band, the pair has moved within striking distance of retesting 1.3100 handle. Possibilities of traders taking some profits off the table cannot be negated after the pair witnessed a sharp recovery of around 300-pips, which was backed by strong UK economic data, from a 5-week low touched during the early part of the week.

Meanwhile, weakness in European equity is also pointing to the prevalent risk-off sentiment and is further extending support to the broad based greenback recovery in absence of any fresh economic / fundamental trigger.

Technical levels to watch

Break below session low support near 1.3115 level is likely to the pair's corrective move and drag it below 1.3100 round figure mark. However, weakness below 1.3100 mark is likely be bought into and hence, might limit further downslide at a previous strong resistance now turned support near 1.3060-50 region. 

Meanwhile on the upside, 1.3175-80 zone remains immediate hurdle, which if cleared should boost the pair immediately towards 1.3255-60 horizontal resistance before the pair darts towards reclaiming 1.3300 level and head back to monthly high resistance near 1.3350-70 region.